EN BANC

[G.R. No. 110798. July 20, 1999]

ODELON T. BUSCAINO, petitioner, vs. COMMISSION ON AUDIT, respondent.

DECISION
PURISIMA, J.:

This is a petition for certiorari assailing the decision of the Commission on Audit (COA)

which adjudged petitioner Odelon T. Buscaino jointly and solidarily liable with the President of
Polytechnic University of the Philippines (PUP), Dr. Pablo Mateo, and other PUP officials and
employees in the amount of P1,527,176.40 for audit disallowances based on the schedule of
disallowances submitted by the resident COA Auditor of the Polytechnic University of the
Philippines.
The facts of the case that matter are as follows:
Petitioner Odelon T. Buscaino is the Director of Fiscal Management Services of the
Polytechnic University of the Philippines (PUP) with position item of Chief Financial
Management Officer II. His functions include signing disbursement vouchers and certifying the
availability of funds and legality and propriety of supporting documents. As such, petitioner is
one of the necessary PUP official signatories to every disbursement voucher of PUP before
payment thereon can be made.
Petitioner is also a member of the PUP Canvass and Award Committee which reports the
results of every bid or canvass conducted and at the same time, recommends to the PUP
President the award of purchase or service contract to a supplier.
Ireneo Monteverde, former Auditor of PUP, issued four (4) Certificates of Settlement and
Balances (CSBs) No. 86-003-151, 86-004-151, 86-007-151, and 86-008-151, dated May 23, July
28, November 12, and December 15, 1986, respectively, disallowing in audit an aggregate
amount of P993,933.32, involving overpriced purchases of various office and school supplies in
violation of pertinent laws, applicable rules and regulations.
A motion for reconsideration of the aforestated disallowances was interposed by former
PUP President Dr. Pablo Mateo and the herein petitioner, Odelon Buscaino.
On March 3, 1989, the Commission on Audit (COA) came out with its Decision No. 826,
affirming subject disallowances ordered by the PUP Auditor on the ground that there was no
public bidding and/or canvass resulting in overpricing in the purchase of the various office and
school supplies in question and holding petitioner jointly and severally liable with Dr. Pablo
Mateo, and Dr. Juan E. Manuel, Jr., former President and Vice-President of PUP, respectively,
for the said disallowances.
 In a letter, dated August 2, 1989, addressed to then Commission on Audit Chairman
Eufemio Domingo, petitioner sought reconsideration of Decision No. 826 on the following
grounds:

a. Based on existing documents, there was evident suppression of vital information which if
made known to the authorities concerned, may have rendered a contrary decision; and

b. The existing conditions and circumstances, at the time when some of the purchase were made,
have not been given due consideration in post auditing the vouchers for the payment thereof.

During the pendency of the motion for reconsideration, former Auditor Ireneo Monteverde
was succeeded by Auditor Federico Calpotura. After a reevaluation of the disallowances with
respect to subject transactions, the motion for reconsideration was denied in COA Decision No.
1508 dated September 20, 1990. The aforesaid decision likewise increased the amount of
disallowances from P993,933.32 to P2,379,304.98 and the corresponding Certificates of
Settlement and Balances (CSBs) from four (4) to sixteen (16). As a result, petitioner is being
held jointly and solidarily liable for the following transactions:
Check No. Nature of Amount Reason for
Transaction Disallowed Disallowance
       
CSB No. 86-      
007-151
     
 
Purchase of school P206,534.15 Aside from
1. TW- and supplies being
8,05,333,824 signatory to
Box No. 4 of
the voucher,
Mr. Buscaino
is a signatory
to the Abstract
of Bids as
member of the
Canvass and
Award
Committee,
which
certified that
the prices are
fair and the
lowest, and
recommended
the award to
the Supplier.
2. TW 8-05- -do- 68,125.00 -do-
333-823
CSB No. 86-      
008-151
3. TW -do- 58,294.00 -do-
8,05,333,876
4. SNB- -do- 42,038.50 -do-
3873896-1
5. SNB- Purchase of 6 drums 10,800.00 -do-
3873960-2 Hy-tox
6. SNB- Purchase of 500 6,925.00 -do-
3874005-5 boxes of chalk
CSB No. 87-      
002-151
7. SNB- Purchase of 1,000 14,250.00 Signatory only
3874216-6 rolls typewriter to the Abstract
ribbons of Bids, as
member of the
Canvass and
Award
Committee
which
certified that
the prices are
fair and the
lowest, and
recommended
the award to
the supplier
8.SNB- -do- 14,250.00 -do-
3874214-4
9.SNB- Purchase of school 31,550.00 -do-
3874235-4 and office supplies
CSB NO. 87-      
004-151
10.SNB- -do- 24,121.00 -do-
3874384-6
11.TW-B, -do- 216,289.50 -do-
05,466,446
12.TW-B -do- 62,573.00 -do-
05,466,445
CSB No. 87-      
005-151
13.TW-B, -do- 14,344.00 -do-
05,509-319
14.SN6- -do- 29,100.00 -do-
1968866-1
15.TW-B, -do- 12,773.00 -do-
05,509,321
16.TW-B, -do- 36,567.70 -do-
05,509,320
17.TW-B, -do- 124,971.75 -do-
05,509,323
18.TW-B, -do- 55,098.50 -do-
05,509,322
19.SN6- -do- 15,949.80 -do-
1968869-4
20.SN6- Purchase of 6 drums 10,770.00 -do-
1968879-0 of Hy-tox chlorine
CSB No. 87-      
017-101
21.TW-B, Purchase of 125 50,800.00 Short delivery
05,204,044 units of Manual by four (4)
Typewriters units.Mr.
Buscaino is
the signatory
to Box 4 of
the voucher
certified that
the transaction
was supported
by documents
appearing
legal and
proper. The
voucher was
supported by
only one (1)
Sales Invoice
bearing only
121 serial nos.
and no other
proof of
additional
delivery.
CSB No.86-      
002-151
22.SN5- Payment of 500.00 Mr. Buscaino
7567061-6 housing P allowance is the
for Feb. 1986 to signatory to
former PUP Pres. Box 4 of the
voucher,
certified that
 the transaction
was supported
by documents
appearing
legal and
proper. The
voucher is not
supported by
any document.
CSB No.86-      
003-151
23.SN5- -do- 500.00 -do-
7580362-0 Mar. 1985
CSB No.86-      
004-151
24.SN5- -do-    
7580561 April, 1985 500.00 -do-
CSB No.86-      
005-151
25.SN5- -do-    
7580726 May 1985 500.00 -do-
CSB No.86-      
006-151
26. SN5- -do-    
7580937-1 June 1985 500.00 -do-
CSB No.86-      
003-151
27.SNB- -do-    
3873861-1 July ,1985 500.00 -do-
CSB No.86-      
008-151
28.SNB- -do-    
3874007-0 August, 1985 500.00 -do-
CSB No.86-      
004-151
29.SN5- Payment of gasoline 302.00 -do-
7580508-6 and toll gate fees
CSB No.86-      
004-151
30.SN5- Purchase of 249 249.00 Mr. Buscaino
7580551-0 supplies is the
signatory to
Box 4 of the
voucher. The
supplies were
 delivered in
advance (on
Mar 8/85) w/o
canvasses nor
Purchase
Order.The
confirmation
of the delivery
was on
Mar.20,1985.
CSB No. 86-      
008-101
31.TW-B-05- Payment of ITT 405,000.00 Mr. Buscaino
333-932 Telephone System is the
to Asia Pacific Phil., signatory to
Inc. Box 4 of the
voucher. Per
CSB issued by
the former
Auditor. There
was no refund
in 1985 for the
purpose. The
transaction
was paid out
of the
revalidated
CDCs of prior
years accounts
payable
obligated in
1983 in favor
of various
creditors other
than the
supplier,
hence,
violation of
Sec. 43, P.D.
1177.
32.SN5- Purchase of school 12,000.00 Mr. Buscaino
7580495-0 and office supplies is the
signatory to
Box 4 of the
voucher,
 certifying that
the transaction
was supported
by documents
appearing
legal and
proper. The
transaction
was not
supported by
any canvass
nor Purchase
Order.It was
an advanced
delivery
confirmed
only later.
The pertinent portion of COA Decision No. 1508 reads:

xxx In sum, these disallowances are the result of overpricing of school and office supplies
procured without canvassing or bidding in the aggregate amount of P1,948,455.33; unnecessary
procurement of telephone system; short delivery of four (4) units of typewriter at a total cost of
P50,800.00; unauthorized collection of allowances; and expenditures for health, transportation,
and gasoline for unofficial purposes.

The aforecited decision included Mr. Jaime Dolor, Mr. Juan del Rosario and Mr. Adolfo
Aquino as additional persons jointly and severally liable with the petitioner and the other PUP
officials.
Again, petitioner presented a motion for reconsideration of the above decision, alleging
among others, that:

a. Petitioner Buscaino had signed Box No. 4 of the Disbursement Vouchers (Form No. 5A, Rev.
1981) in his capacity as Chief of Accounting Office whose only concern was to type figures and
computations and to check if all documents required for the transactions are attached and has
nothing to do with overpricing; and

b. Petitioner, as a public official, properly and regularly discharged his duties, or performed the
acts in accordance with law and regulations for the signature to the vouchers, and that he did not
do any act contrary to his official duty or omit to do anything which such a duty may require.

Petitioner contends that as Chief Accounting Officer, (a) the nature of the design of the
Disbursement Vouchers he signed precludes petitioner from liability in the disallowances; (b) the
purchases and prices were legal and regular; (c) petitioner had no reason to believe that the acts
of his superior are not regular; and (d) petitioner acted with extraordinary care and in utmost
good faith.
 On August 19, 1991, petitioner wrote to Auditor Federico Calpotura requesting that he be
furnished with documents and informations needed for his defense, that would exclude him from
liability, including the following:
a. Quotations of prices of every item re-canvassed by then COA Auditor Monteverde,
indicating the brand and/or quality of the items;
b. Names and addresses of suppliers/persons/entities where the items were re-
canvassed;
c. Date when items were re-canvassed; and
d. Certified copies of official forms in the re-canvass of the items
Auditor Calpotura responded to the request of petitioner in the negative, stating that:

No such documents as you indicated above were turned over to the undersigned. However, the
manner and basis of the disallowances were explained (and) noted in each disallowed transaction
in every CSB issued by then Auditor Monteverde.

Petitioners follow-up elicited a similar response:

I can understand your plight of course but I cant produce what I dont have. Please see the
individual CSB which you have already obtained from this Office where I relayed (sic) upon,
since said document are official.

Thereafter, petitioner wrote to the then Commission on Audit Chairman Domingo

questioning the propriety and validity of the new CSBs issued by Auditor Calpotura on
September 27 and 28, 1989, increasing the disallowances to P2,379,304.98.
On April 12, 1993, the COA rendered Decision No. 2826, disposing thus:

After a circumspect evaluation of the facts of the case and a scrutiny of the accompanying
documents, this Commission finds merit in the recommendation of the new PUP Auditor to
exclude Mr. Buscaino from the list of persons held liable for the above-enumerated transactions
which were partly disallowed on the ground of overpricing. The excessiveness of the purchase
prices in those transactions is outside the ambit of responsibility of Mr. Buscaino who signed the
corresponding vouchers only in his capacity as an accounting officer.

xxx

However, for the rest of the transactions in question, it was clearly established that Mr. Buscaino
either signed the subject documents as an accounting official or as a member of the Canvass and
Awards Committee that recommended the award of the corresponding contracts to the suppliers
or both accounting official and member of such committee. x x x

Premises considered, this Committee hereby excludes Mr. Buscaino from the list of persons
liable for the audit disallowances amounting to P428,678.12 made on the eight (8) above-
mentioned transactions.However, he shall remain jointly and severally liable with the other PUP
officials and employees for the rest of the transactions described in the schedule of disallowances
submitted by the PUP Auditor amounting to P1,527,176.40.

Unable to obtain complete affirmative relief from respondent COA, petitioner found his way
to this Court via the petition for certiorari under consideration.
The sole issue posed for resolution here is - whether or not the Commission on Audit
committed grave abuse of discretion amounting to lack or excess jurisdiction in holding
petitioner jointly and solidarily liable with the other PUP officials and employees for
reimbursement of subject audit disallowances.
Before delving into the merits of the case, the timeliness of the petition must first be looked
into and passed upon.
Respondent maintains that the petition must be denied on the ground of late filing; pointing
out that on July 15, 1993, when the petitioner presented his motion for extension of time for the
filing of a petition for review of COA Decision No. 2826, almost two months had already lapsed
from the time of receipt of subject decision on May 30, 1993 and not on June 15, 1993, as
theorized upon by petitioner. It is also claimed that on August 2, 1989, when petitioner filed a
motion for reconsideration of COA Decision No. 2826, dated July 24, 1989, the eight (8) days
that had lapsed must be deducted from the mandatory period of thirty days for filing a petition
for certiorari. It is then submitted that the petitioner had only twenty-two days left, from May
30, 1993, within which to bring his petition.
Petitioner, on the other hand, insisted that he received a copy of COA Decision No. 2826 on
June 15, 1993, such that when he prayed for an extension of time within which to file his
petition, on July 15, 1993, the said motion was seasonably presented within the thirty-day period.
At the outset, it must be stressed that the COA Decision petitioner appeals from is COA
Decision No. 2826 dated April 12, 1993, the last decision of the Commission on Audit on the
matter.Consequently, the thirty day period for filing a petition for certiorari should be reckoned
from the date subject decision was received by the petitioner. Our pivot of inquiry therefore is
the true date petitioner received COA Decision No. 2826.
As evinced by the allegations of the parties, the issue at bar is factual in nature. Normally,
this Court does not rule on a question of fact. However, since the factual issue aforestated is
relevant to the resolution of the issue of timeliness of filing of the petition, the Court may rule on
this question.
Respondent contends that subject decision was received by petitioner, through his secretary,
on May 30, 1993. On the other hand, it is petitioners submission that he received such decision
on June 15, 1993, when a copy thereof was sent to his residence by PUP President Zenaida
Olonan as he was then on official sick leave from PUP.
Petitioners allegation that he received the decision only on June 15, 1993 finds support in
the evidence that he was, in fact, on official sick leave from PUP, as shown by Annex A - a
medical certificate from Lyceum Northwestern General Hospital in Dagupan City stating that
petitioner was under the hospitals medical care, Annex A-1 - petitioners approved application for
leave from PUP for the period April 12 to May 31, 1993 and Annex A-2 - petitioners approved
application for leave for the period June 1-30, 1993. It is thus understandable that petitioner
received subject decision by registered mail on June 15, 1993 and his motion for extension of
time sent in on July 15, 1993 was filed on the thirtieth day, within the 30-day reglementary
period.
Assuming arguendo that the thirty days for filing a petition for certiorari had already lapsed,
this Court may still allow and, in fact, has allowed some meritorious cases to proceed despite the
procedural defect or lapse; in keeping with the principle that rules of procedure are mere tools
designed to facilitate the attainment of justice and that strict and rigid application of rules which
would result in technicalities that tend to frustrate rather than promote substantial justice must
always be avoided.[1]
Going into the merits of the case, the Court finds that the Commission on Audit acted with
grave abuse of discretion in handing down its assailed decision. The various disbursements upon
which petitioners liability is based have not been indubitably established as patently invalid or
irregular and the disallowances ordered by COA were not substantiated by sufficient evidence on
record.
To begin with, as regards the items disallowed on the ground of overpricing, petitioner was
adjudged liable therefor because he was a member of the Canvass and Award Committee which
was tasked to certify that the prices submitted were the lowest and which recommended the
award to the supplier. The disallowances were made on the basis of respondents allegation or
theory that the school and other office supplies may be bought from other suppliers at prices
much lower than those of the supplier to whom the bid was awarded.
In order to find out how the COA reached such a conclusion, petitioner asked the COA to
furnish him with the necessary information and/or documents that would indicate the large
disparity in the prices such as the quotation of prices of every item re-canvassed by the resident
auditor, reflecting the brand or quality of the items, the names and addresses of the suppliers
where the items were re-canvassed and the date subject items were re-canvassed. Respondent
COA, however, did not furnish the same on the two occasions that the said request was
made. Without the necessary information and/or documents, it baffles the Court how COA could
have arrived at the conclusion that there were cases of overpricing. And without the needed
information and/or documents, the petitioner was not afforded the opportunity to refute the
disallowances, item by item, and to justify the legality of the purchases involved. As argued by
the petitioner,

How can the undersigned (petitioner) determine the difference in prices and per cent increases
between the then procurement officers canvassed prices and the then COA Auditors re-canvassed
prices and possibly justify item by item the legality of the purchase when as you said no such
document as you indicated above were turned-over to the undersigned (present PUP COA
Auditor)? The purchase orders contain several items and it is important that those items which
were allegedly overpriced should be identified.

The requirements of due process of law mandate that every accused or respondent be
apprised of the nature and cause of the charge against him, and the evidence in support thereof be
shown or made available to him so that he can meet the charge with traversing or exculpatory
evidence. COAs failure to furnish or show to the petitioner the inculpatory documents or records
of purchases and price levels constituted a denial of due process which is a valid defense against
the accusation. Absent any evidence documentary or testimonial to prove the same, the charge of
COA against the herein petitioner must fail for want of any leg to stand on.
In the 1991 decision in the case of Virgilio C. Arriola and Julian Fernandez vs. Commission
on Audit and Board of Liquidators,[2] rendered on September 30, 1991, which was reiterated in
the case of National Center for Mental Health Management vs. Commission on Audit on
December 6, 1996,[3] this Court succinctly held that mere allegations of overpricing are not,

x x x in the absence of the actual canvass sheets and/or price quotations from identified
suppliers, a valid basis for outright disallowance of agency disbursements/cost estimates for
government projects.

A more humane procedure, and totally conformable to the due process clause, is for the COA
representative to allow the members of the Contracts Committee mandatory access to the COA
source documents/canvass sheets. Besides, this gesture would have been in keeping with COAs
own Audit Circular No. 85-55-A par. 2.6, that:

x x x As regards excessive expenditures, they shall be determined by place and origin of goods,
volume or quantity of purchase, service warranties/quality, special features of units purchased
and the like x x x

By having access to source documents, petitioners could then satisfy themselves that COA
guidelines/rules on excessive expenditures had been observed. The transparency would also
erase any suspicion that the rules had been utilized to terrorize and/or work injustice, instead of
ensuring a working partnership between COA and the government agency, for the conservation
and protection of government funds, which is the main rationale for COA audit.

xxx xxx xxx

We agree with petitioners that COAs disallowance was not sufficiently supported by evidence, as
it was premised purely on undocumented claims, as in fact petitioners were denied access to the
actual canvass sheets or price quotations from accredited suppliers. xxx

xxx xxx xxx

It was incumbent upon the COA to prove that its standards were met in its audit
disallowance. The records do not show that such was done in this case.

x x x absent due process and evidence to support COAs disallowance, COAs ruling on
petitioners liability has no basis.

Indeed, without the evidence upon which the charge of overpricing is anchored, apart from
being a denial of due process, it would not be possible to attach liability to petitioner.
As regards the disallowance of the PUP Presidents monthly housing allowance of P500.00,
COA contends that subject disbursement was disallowed for lack of legal basis. However, the
petitioner herein has pointed out the proper basis for such housing allowance. Evidence on
record includes a copy of the resolution of the PUP Board of Trustees, Resolution No. 1445
dated February 4, 1977, authorizing the grant of commutable housing allowance to the head of
the College and a certification from the PUP Cashier attesting to the payment of similar monthly
housing allowance to past Presidents of the institution (PUP).
The said Resolution of the Board of Trustees of PUP authorizing a housing allowance was a
sufficient basis for the disbursement. As the Solicitor General stated in his Comment, it is
beyond petitioners competence to pass upon the validity of such board resolution, his duty with
respect thereto being purely ministerial. Petitioner could not have questioned the grant of
housing allowance as his task was just to certify that the disbursement was properly supported by
the Resolution of the PUP Board of Trustees. It was an error for respondent COA to hold him
liable in connection with subject disbursement.
Anent the charge of short delivery of four units of typewriter, respondent COA held
petitioner accountable for the four undelivered typewriters for the reason that the disbursement
voucher bears his certification that the purchase was duly supported by the requisite documents
although the delivery of the 125 total units purchased was short of four units.
However, pertinent records indicate that the four typewriters in question were delivered on
January 6, 1984 under Delivery Receipt No. 155526 with the notation - To complete delivery per
MN # 68446 (Sales Invoice). Sales Invoice 68466 is the original receipt for the 125 units of
typewriter purchased. But as explained by petitioner, upon delivery of the 125 typewriters he
ordered the return of the four units which were defective, such that the four units involved were
covered by a different delivery receipt. The fact of delivery thereof is also evidenced by a gate
pass, dated January 6, 1984, containing a list of the items that were transported on said date,
including the four units of typewriter bearing serial numbers 32209353, 32209340, 32209864
and 32109158, respectively. The same was likewise certified to by PUP Property Inspector Juan
del Rosario under his Management Inspection Report dated March 19, 1984 and by Property
Officer Adolfo Aquino under the corresponding Memorandum Receipt of March 20, 1984.
The existence of the missing typewriters is also borne out by a certification dated September
3, 1993 of PUP Internal Auditor Sylvia A. Sarmiento to the effect that two Triumph typewriters
with serial numbers 32209353 and 32209340 have been located at Rooms W306 and E311 and
their physical existence verified.
So also, with respect to the emergency purchase and advance delivery of supplies disallowed
by COA for lack of supporting canvass and purchase order, it appears that subject purchases
were upon the orders of PUP President Pablo Mateo who was authorized to determine and decide
on emergency purchases. The determination of whether certain supplies were urgently needed
was the prerogative of the PUP President. Whenever he certified to the necessity of disbursement
for emergency procurements, petitioner was not in any position to question the wisdom of such
decision of the PUP President.
Respondent contends that under COA Circular 78-84, emergency purchases can only be
made (1) whenever the supplies, materials and equipment are exceptionally urgent or absolutely
indispensable to prevent immediate danger to, or loss of, life and/or property and (2) whenever
the supplies are to be used in connection with a project or activity which cannot be delayed
without causing detriment to public service; and that the petitioner did not show that the
emergency purchases in question were proper.
 Again, it was an error for COA to rule that petitioner had the burden of showing that the said
purchases were exceptionally urgent or absolutely indispensable to prevent immediate danger to,
or loss of, life and/or property or were to be used in connection with the project or activity which
could not be delayed without jeopardizing public service. The PUP president is the one
authorized to act on and determine the necessity of such procurement. The circular cited by
respondent COA requires, among others, a certificate by the head of the agency or his duly
authorized representative as to the necessity and justification for the emergency purchase. The
head of the agency referred to is no other than the PUP president. As accounting officer,
petitioners duty was merely to sign the vouchers for the disbursement of the funds therefor. And
because the purchases were exceptionally urgent, the usual canvass procedure was not resorted
to.
With regard to the payment of ITT telephone system to Asia Pacific Philippines, Inc.,
respondent also erred in adjudging petitioner liable for certifying that an allotment thereof was
approved and available when in fact there was no appropriation for that purpose.
Petitioner has established that in 1983, the Department of Budget and Management
approved and released an allotment for the purchase of ITT telephone system for PUP but the
contract with the original supplier thereof was rescinded due to the failure of the supplier to
deliver the same. Thus, in 1985, when PUP decided to purchase the needed telephone system
from Asia Pacific Phils., Inc., petitioner prepared and signed the corresponding disbursement
voucher as the allotment funds therefor were intact and still available. As satisfactorily explained
by petitioner, his only duty under the circumstances was to state that an allotment for the
purchase of subject telephone system was existing. Respondents finding that there was no
appropriation for the purpose is therefore erroneous.
As regards the disallowance of the payment of gasoline and toll gate fees for alleged lack of
legal and proper documents supporting the same, the evidence on record shows that there are
attached to the covering disbursement voucher duly approved drivers tickets and receipts.
Disallowance in audit by the Commission on Audit may be set aside and nullified by the
Supreme Court if tainted with grave abuse of discretion. [4] In the case under scrutiny, petitioner
has amply shown that the COA disallowance in audit sued upon was attended by grave abuse of
discretion warranting its nullification.
WHEREFORE, the petition is hereby GRANTED and Decision No. 2826 of the
Commission on Audit REVERSED and SET ASIDE. No pronouncement as to costs.
SO ORDERED.
Romero, Bellosillo, Melo, Vitug, Kapunan, Mendoza, Panganiban, Quisumbing, Pardo,
Buena, Gonzaga-Reyes, and Ynares-Santiago, JJ., concur.
Davide, Jr., C.J., in the result.
Puno, J., No part. Related to counsel.